Will a Bear Market Bring Commercial Real Estate Out of Its Cave?

Abstract

Unlike a bull market, which typically lasts around 32 months, bear markets only average about 11. Real estate has generally been considered a safe investment for these down market periods. The good, the FED, and the ugly Market watchers have put up a wide range of potential explanations for the onset of a bear market. The tight labor market has pushed up the price of hiring in many industries which creates a very real possibility of another wave of inflationary price increases, especially if the Fed's actions fail to slow the job market as they hope. So if that's the case, how should real estate players handle this period of market volatility? Invest all odds John Mazurek, Executive Manager of Sales at Douglas Elliman Real Estate, noted that in the last 20 bear markets since the '50's, only twice have real estate values gone down in value. Where are you going to park your money in a bear market that's as stable long-term as real estate?" Kevin Shtofman, Chief Operating Officer at NavigatorCRE, a platform that helps commercial real estate customers integrate and visualize all types of data, is seeing the upside to the market's downside. " Despite the bleak cacophony of bad news whirling around in the echo chamber, bear markets can be beneficial, if not essential, for the long-term health of commercial real estate.